AUD/USD Forecast – Australian Dollar Shoots Higher

AUD/USD Forecast Video for 31.08.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has had a bullish session during the day on Wednesday initially, as we continue to see economic numbers out of the United States cool. By doing so, it gives traders hope that the Federal Reserve might slow down its overall monetary policy, which of course has been very restrictive. That makes Wall Street nauseous, because it’s all about liquidity for Wall Street, and not necessarily about the economy itself. In other words, we have reentered that “bad news is good news” scenario, which is so frustrating for those watching. That being said, it is the game that we play.

When I look at this chart, I recognize that although we could get a little bit of a bounce here, there are some major barriers to overcome. For example, we have to worry about the 50-Day EMA near the 0.6575 level, but we also have a lot of fundamental barriers as well. For example, we have to worry about the Non-Farm Payroll announcement coming out on Friday, which will have a major influence on what happens next. However, and perhaps flying a little bit under the radar of retail traders, we have the Core PCE numbers coming out on Thursday, one of the favored indicators used by the Federal Reserve to get a gauge on the economy.

In other words, if those numbers show inflation or strength in America, that could turn this market right back around. Expect a lot of volatility and noisy behavior, but by the end of the week it’s very possible that we could see this market make up its mind for a bigger move either toward the 0.69 level over the longer-term, or turning around or breaking below the 0.64 level. If we were to see a breakdown below the 0.64 level, the bottom could fall out in the Aussie dollar, which would make a certain amount of sense considering just how precarious of a situation the global economy is in, as Australia is a major commodity exporter and of course sensitive to so many other economies around the world as a result.

For a look at all of today’s economic events, check out our economic calendar.